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In The Future of the Degree: How Colleges Can Survive the New Credential Economy, Jeffrey J. Selingo, professor and expert in higher education, outlines the biggest challenges college degrees face today in the knowledge economy.

By Esteban Fredin

The college degree has traditionally been seen as the culmination of student life and a symbol of work readiness. However, a new report published by The Chronicle of Higher Education questioned the usefulness of university degree in a world where the line that separates students from working professionals is blurred by the constant need to stay up to date in skills and knowledge, the threat of automation, and a labor market facing international competition.

In The Future of the Degree: How Colleges Can Survive the New Credential Economy, Jeffrey J. Selingo, professor and expert in higher education with over twenty years of experience, outlines the biggest challenges college degrees face today in the knowledge economy. Contextualized in the history of higher education in the US, the report explores the evolution of university diplomas and their complex historical and economic relationship with employers need for qualified talent. The current crisis of academic credentials is largely due to its current format: a two-century legacy emphasizing the time spent sitting in class and the inability to quantify and communicate learning both inside and outside the classroom.

Much has changed in this time span. However, curricula and teaching methods aside, if obtaining a college degree is considered the final result of higher education, universities have not changed much in decades, and in some respects, centuries. Obtaining a diploma still takes too long, is too expensive and offers more than necessary in practical terms.

For years economists have explored the theory that the intrinsic value of university education is not the number of hours or the effort that students have spent studying, but the piece of paper you get attend of the process, the so-called sheepskin effect (because in the past degrees were made of parchment). The diploma matters as tool in the hiring process only in the absence of other relevant employability signs such as work experience or performance on a similar job. The report identifies four reasons why employers value university diplomas in their selection process and how these are quickly eroding quickly in the current economic landscape:

The university diploma has been generally considered a signal of work readiness. However, to the extent that more adults acquire a higher education diploma, its value as a sign of employability decreases, and only becomes important when it has the the backing of a reputable institution.

Historically the degree has been a selection mechanism for recruiters, but due to the increase in college graduates and the ease and convenience of finding and applying to a job online it has diminished its importance.

The idea that higher education provides the cultural capital necessary for excelling in a job has also been affected. There is increasing evidence which shows that graduates suffer from the soft skills needed to succeed in today’s workplace. A Gallup poll reveals that only 11% of business leaders believe that graduates have the skills to perform successfully on the job.

The belief that an academic degree improves individual productivity through formal instruction is also on decline. The disparity between the experiences of students from the same institution or the same major at different universities, means that recruiters increasingly don’t understand 'what is inside the box are buying'. Due to this uncertainty, the reputation of the institution plays a major role in the hiring process.

The diminished usefulness of degrees in terms of recruitment, has driven employers of all kinds and sizes to look at other signs that go beyond the traditional college degree to select their prospects. Several companies have resorted to mining performance data of their own employees to find out what variables in the résumé and curriculum vitae of the applicant are statistically correlated with success on the job.

Given this situation, universities must innovate if they want to improve the employability of their graduates. In response to these new recruitment and scouting techniques with data analytics, the future academic credentials need to fulfill the following functions to remain relevant:

Encompass the learning experience both inside and outside the classroom.

Communicate an integrated experience; there must be a coherent curriculum behind each certificate.

Enforce a common standard for all universities. A title is only recognized by a few institutions is useless for any practical purpose.

On the other hand, the idea that college is a once in a lifetime experience and that it marks only the beginning of a professional career is bound to disappear. Lifelong education has become an economic necessity because jobs today require continuous learning, both in formal and informal contexts. In that sense, university diplomas are no longer a sorting mechanism, but the representation of an individual’s skills and competencies.

Adults will need to go in and out of a higher education system that can vouch for all their learning experiences with labor market value, regardless of the context in which they take place. The following trends could define the qualifications of the future:

Instead of paper records housed by universities, credentials will be electronic assets belonging to the learner and maintained in a virtual network using the same blockchain technology that makes cryptocurrencies like bitcoin safe and decentralized. MIT has already awarded its first diplomas through this method.

In addition to traditional certificates, universities will grant new types of micro-credentials like badges that recognize lifelong learning.

Rather than exist as a single document, credentials will need to be communicated through portfolios that demonstrate the knowledge and skills of the bearer.

The increasing use of data analytics in hiring decisions could reduce the importance of the certificate, but increase the relevance of specific learning experiences within university.

In conclusion, the report The Future of the Degree: How Colleges Can Survive the New Credential Economy suggests that higher education institutions need to rethink what serves as evidence of learning: time sitting in a classroom, or the mastery of a topic or concept. Many valuable experiences of university life do not contribute to the accumulation of credits in the current system. It will also be necessary to conceptualize the curriculum not as a fixed object, but as smaller slices that provide evidence of incremental progress in well defined competences. This is because learning is now a lifelong experience. The ability to stay afloat in any career change too fast for higher education to happen only once early in life.

Finally, in terms of format, the degree will no longer be a piece of paper given at a ceremony, it will turn into bits of data and information in an decentralized electronic repository. Academic authorities can ignore the recommendations of Selingo and continue their traditional patterns, but the cost would be to alienate higher education further from the workplace.